US Treasury Secretary Steven Mnuchin told President Donald Trump at a Cabinet meeting on Thursday that sanctions were ready to be put in place if Brunson, who is on trial in Turkey on terrorism charges, was not freed. Erdogan has cast the tariffs, and the lira's sell-off, as an "economic war" against Turkey.
"There was considerable risk aversion through the early part of the week with fears of Turkish contagion weighing on risk assets and that seems to have reversed somewhat here", said Karl Schamotta, a strategist at Cambridge Global Payments in Toronto.
Meanwhile, Turkish President Recep Tayyip Erdogan has consolidated power over the central bank, and pushed for it to refrain from raising interest rates to support the currency, as experts say it should.
The Turkish lira has already lost about 30 percent of its value against the U.S. dollar since the beginning of August, when tensions between the two North Atlantic Treaty Organisation allies soared unprecedentedly over the detention of Andrew Brunson, an American Christen pastor, in Turkey over terror-related charges.
The Turkish lira has been in a steady slide and reached an all-time low earlier this week. In the beginning of his campaign, Trump vowed to help the famous motorcycle company lower the export tariffs to Europe, however most European countries in response to increasing aluminum and steel tariffs have in fact doubled and tripled the tariffs for Harley Davidson, making the motorcycles too expensive to export. Turkey retaliated with some $533 million of tariffs on some US imports - including cars, tobacco and alcoholic drinks - and said it would boycott USA electronic goods.
The Turkish president emphasized Turkey's determination to eliminate all threats from Syria and Iraq. "Tax rates on imports of some products have been increased on a reciprocal basis against the US administration's deliberate attacks on our economy", the country's vice president, Fuat Oktay, said in a pair of tweets. Turkey's dollar bonds fell, while the cost of insuring exposure to Turkish debt rose.
Ex-Trump aide Manafort's defence rests, case headed to jury
Gates was also forced to admit embezzling a fortune from Manafort and having an extramarital affair. Ellis said the proceedings and the motion will be kept secret until after the case concludes.
The rising tensions have caused the value of the lira to plunge by about a third of its value against the dollar since January.
The Committee of Concerned Scientists has compared the Brunson case to that of Serkan Golge, a NASA scientist who was arrested at the time of the coup attempt and was sentenced to more than seven years in prison for alleged links to Gulen's group. They are now holding our wonderful Christian Pastor, who I must now ask to represent our Country as a great patriot hostage.
The fight between Turkey and the USA has escalated in recent weeks, with Brunson's detainment as a flashpoint.
If the evangelical pastor is found guilty, he will face up to 35 years in jail.
Turkey has been pushing back against U.S. pressure, insisting that it will determine its own economic policies and choose its own trade partners.